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Preamble
My article has been prompted by the interview with Harvey Organ with Greg Hunter on the 10th September 2014.
Since that time Harvey’s blog has been taken off the web by court order.
This signals to me that Harvey Organ is very close to the truth.
I do not rely on statistical charts to
forecast the future I prefer to use common sense and that common sense tells me
that the current imbalance in society and the financial markets will cause a
perfect storm of trouble and strife on a global scale which none of us will be
immune from.
It takes $1000 of manpower to produce 1 oz of Gold it takes $1 to produce $1000 of paper money.
Article
The folly of QE has best served the elite. The figures regarding productivity to boost GDP have been manipulated. The manufacturing base of the West has been destroyed by China. All these factors have already been built into the system by the think tanks.
Easy monetary policies of those countries involved in QE is sowing the seeds of their own demise. Flooding the economy and financial markets with money (and credit) created out of thin air – thereby distorting interest rates and price signals and, in so doing, creating malinvestments – is no way to create sustainable, economic growth and ever rising equity prices. Sure, at first glance, the malinvestments and attendant booming equity prices look like genuine growth and wealth creation. But they are not.
Like extreme weather patterns which share a common link with the ever-increasing reliance of fossil fuels, so too is the pumped up wealth which relies on Government’s around the World increasing money supply by way of QE.
In both cases this is opposing the natural forces and it will ultimately fail.
Enter 2015 and the signals will be flashing loud and clear.
We are now seeing China fraying around the edges (China’s QE outstrips that of the US) and the time is nearing when the two biggest economies in the world will collapse like houses of cards’.China has one advantage it is sitting on 6000 tonnes of Gold and the US and Britain purportedly have none.
The West is already suffering deflation so it stands to reason that China will follow
sometime in 2015 The stress caused by falling GDP in China is when China will ask for all its gold back which is currently long at Comex.
All countries that have relied on the US & China to promote their own growth will show that they are all bankrupt of any ideas that satisfy the masses.
Christine Lagarde quoted in January 2014 “We need a reset in the way the economy grows around the world”
I would prefer to say “We need a reset in the way that governmental policies reward productivity and do not promote greed through artificial means.
You cannot spend your way out of a recession or borrow your way out of debt. The measure of who we are is what we do with what we have.
Finally, quote from Ludwig von Mises
The gold standard has one tremendous virtue: the quantity of the money supply, under the gold standard,is independent of the policies of governments and political parties. This is its advantage. It is a form of protection against spendthrift governments.

Smaulgld

Mike

Thanks for your comment

“The gold standard has one tremendous virtue: the quantity of the money supply, under the gold standard,is independent of the policies of governments and political parties. This is its advantage. It is a form of protection against spendthrift governments.”

This quote was reused by Alan Greenspan in 1966

“Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process.”